IRS Tax Credit of Up to $5,000 Toward Location and Website Accessibility Costs

Nov 5, 2023 | ADA/WCAG Conformance

Check from the United States Treasury

Important: We are neither experts in tax law nor accountants and this does not constitute legal advice in any way. To confirm your eligibility, we recommend you contact your tax advisor.

The IRS provides a tax credit of up to $5,000 toward physical location and website accessibility expenses.

Did you know that the IRS will provide eligble small businesses with a tax credit of up to $5,000 to make their physical location and website accessible and in compliance with the American’s with Disabilties Act (the “ADA”)?

Small business owners are always looking for ways to reduce costs, better serve their customers and employees, and improve profit. A relatively new IRS provision means your business could be eligible for up to a $5,000 credit to build or improve accessiblity for your physical business location and/or your website by making it accessible to persons with disabilities.

The Disabled Access Tax Credit (Title 26, Internal Revenue Code, Section 44), up to a maximum of $5,000, is available to “eligible small businesses” in the amount of 50% of “eligible access expenditures” that exceed $250 but do not exceed $10,250 for a taxable year. A business may take the credit each year that it makes an eligible access expenditure.

Only businesses with less than $1 million in gross revenue or fewer than 30 full-time employees in the prior tax year are eligible for the credit.

Your accountant or tax preparer can assist you further to determine if your business qualifies for the credit.

How do you calculate and claim your credit?

The Disabled Access Credit comes with certain provisions to keep in mind: only half (50%) your accessibility expenses can be claimed for the credit and your business needs to spend a minimum of $250 for the credit to be applied. The maximum total credit is $5,000.

To calculate your credit, subtract $250 from the total you’ve spent on accessiblity construction for your physical location and/or your website accessibility then divide that amount by 2.

For example;

1. Let’s say the total cost of the accessibility portion of your project is $3,500 and the accessibility development costs comprise $2,500 of that amount.

2. Subtract the minimum required amount ($250) from the total: $2,500 – $250 = $2,250

3. Divide $2,250 by half: $2,250 / 2 = $1,125

$1,125 is the amount of your tax credit claim.

As the Disabled Access Credit is annual, your business may be able to claim it each year as long as your physical location and/or website continues to meet accessibility standards by being in conformance with the WCAG (for websites) and in compliance with the ADA. This can substantially off-set the costs of monthly website maintenance (as you would not necessarily have monthly maintenance costs associated with a physical change to your location, such as a wheelchair ramp) which ensures your website remains in comliance in a world where technologies and standards change frequently.

You can claim the credit by filing IRS Form 8826 and submitting it with your tax return.

Please confirm your eligibility with your tax advisor before filiing your tax credit claim

Accessible Adirondack Tourism is committed to providing people with disabilities information on accessible tourism opportunities within the Adirondack region, and we hope you’ll do your part by having an accessible location, website and social media presence.

Author: admin